BT has reported a 37% plunge in third-quarter profit after taking a hit from the accounting scandal at its Italian division.

The telecoms giant said pre-tax profit fell to £526 million in the three months to December 31, down from £832 million in the same period the year before.

The group said earlier this week that it will book a £530 million writedown linked to "inappropriate behaviour" in Italy, up from a previous estimate of £145 million.

On Friday, BT confirmed that Corrado Sciolla, its European head, will leave the firm following the scandal.

BT chief executive Gavin Patterson said: "The good progress we're making across most of the business has unfortunately been overshadowed by the results of our investigation into our Italian operations and our outlook.

"We've undertaken extensive investigations into our Italian business, including an independent review by KPMG, and I am deeply disappointed with the unacceptable practices by some that we've found. This has no place at BT."

Mr Patterson again flagged a "challenging outlook in the UK public sector and international corporate markets", but looked to reassure investors by highlighting record growth at EE and strong momentum in its consumer division.

The investigation into BT's Italian arm revealed irregular accounting practices and a "complex set of improper sales, purchase, factoring and leasing transactions", the firm said.

The net result is there has been an overstatement of earnings at BT's Italian business over a number of years, leading to the upwards revision in the value of the writedown.

BT said its total adjustments relating to the investigation of its Italian business amount to £268 million for "prior year errors" and a specific item charge of £245 million for changes in accounting estimates.

Shares plummeted 19% when BT first revealed details of the scandal on Tuesday, wiping £8 billion off its stock market value.

In better news for the company, revenue over the period rose 32% to £6.1 billion.

It was helped by the addition of 276,000 EE customers in the period and an 8% rise in revenues in broadband and TV.

Openreach, which develops and maintains the UK's main telecoms network used by telephone and broadband providers, also notched up a record 498,000 new customers.

BT has faced calls from rivals to separate Openreach, and in November Ofcom ordered a legal separation of the firm.

Mr Patterson said: "We are pushing ahead with reforms at Openreach, particularly on governance and customer service, and continue to believe an agreement can be reached with Ofcom on its Digital Communications Review.

"We think these changes address Ofcom's concerns and can form the basis for a fair, proportionate and sustainable settlement."